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Tackling the Poverty Premium: combined solutions

Church Action on Poverty’s ‘Food, Fuel, Finance’ programme is looking for creative, grassroots ideas that can help people on low incomes to pay fair prices for everyday necessities.

Over recent months we’ve uncovered all kinds of exciting projects and ideas in communities across the UK. We’re now reflecting on them all and considering how we can best help to share the approaches more widely.

While we complete that process, we’d like to share with you some of the inspirational ideas we’ve been exploring, in a series of blogs. This post will look at community retail hubs – which aim to tackle several aspects of the Poverty Premiuj with one combined solution.(You can still read our previousposts about funeral poverty and food poverty.)

The concept: community supermarkets and social cooperatives

Last year, the All-Party Parliamentary Group (APPG) on Hunger and Poverty recommended the development of a ‘food bank plus’ model which would address the underlying causes of chronic food poverty. A subsequent report by Demos backed this recommendation by advocating a ‘community supermarket’ model.

Demos found that community supermarkets in Europe, Australia and the US were best delivered in the context of “an operating model with wider social aims (e.g. acting as a community ‘hub’ providing healthy eating advice, hosting cookery lessons)…[and offering]…a wider range of community services on site”. Community supermarkets can either offer these additional services themselves, or be co-located with other community and retail services, designed to combat the Poverty Premium across the board and not just in food.

Demos went on to say that “the democratic, community ownership element of community supermarkets in itself helps to address in a long-term sense the broader and intangible drivers of poverty… Co-ops [are] the most likely models to make a feature of this.”

Unfortunately, Demos and the APPG ultimately recommended a ‘Community Shop’ model, which is not a cooperative, does not offer a wider range of services on site, and is totally reliant on selling excess stock. This approach is not well suited to tackling the underlying drivers of food poverty.

There is in fact no example in the UK (or apparently anywhere else) of the sort of ‘combined solution’ that could deliver all of these things in one place. But our research suggests that the best model of ownership and governance for a combined solution would be a social cooperative or multi-stakeholder cooperative. This allows representatives of a number of different interest groups to all have a say in decisions and a role in the governance structure; so decision-making bodies comprise not only employee members but also the beneficiaries of the cooperatives’ services and representatives of the local community. Across Europe, this is a tried and tested model for the community ownership of public services and transitional employment for groups at a disadvantage in the labour market.

In a cooperatively-run community supermarket hosting a range of community and retail services designed to combat the Poverty Premium, the stakeholders would be the ‘member’ services together with the ‘member’ customers. This democratic community ownership would itself help to tackle the isolation and disenfranchisement connected to poverty.

A case study: Oldham Essentials

This pilot of an approach called the ‘Bare Essentials Cooperative’ is being run by the Cooperative Councils’ Innovation Network with Oldham Council. It is designed as a ‘fair and accessible’ alternative to the rent-to-buy market for domestic goods. It can be considered as a form of ‘Community Retail Hub’, selling TVs, sofas and fridges through credit union loans, and in the future insurance products and warranties, energy and energy switching schemes as well. This new approach to retail will “focus staff performance not on the value of the sale, but on the savings achieved for the customer”.

It is not itself a cooperative, but rather a company limited by guarantee, run as a joint venture between Oldham Council and the charity.But it does feature the beginnings of the co-location of a wide range of community and retail services which could help to tackle the Poverty Premium.

A possible way forward: ‘Bare Essentials’ social cooperatives

One possibility for further work tackling the Poverty Premium in communities would be to operate a ‘Bare Essentials’ multi-stakeholder Social Cooperative. By co-locating a range of services and drawing on the advantages of the cooperative ownership model, this project could offer: